The Central Bank set the official dollar exchange rate at above 105 rubles –

The Central Bank of Russia set the official rates for November 27 at 105.06 rubles per dollar and 14.44 rubles per yuan. The achieved values ​​were the highest since March 2022. In turn, the official euro exchange rate rose to 110.49 rubles – the highest level since August 2023.

Using these values, Russian banks and financial institutions set the price for buying and selling currency in their exchange offices. The Central Bank, in turn, determines the official exchange rates of the dollar and euro on a daily basis based on the dynamics of over-the-counter trading, and for the yuan it uses data from the Moscow Exchange.

Since the beginning of November alone, the Russian currency has fallen in price by about 8% against the American currency, by 5% against the European one, and by 6% against the Chinese one. As Freedom Finance Global leading analyst Natalya Milchakova told RT, a number of external and internal factors are currently putting pressure on the ruble.

“Firstly, we see a sharp strengthening of the dollar on the world market after Donald Trump’s landslide victory in the US presidential election. Secondly, recent US sanctions against Gazprombank made a significant contribution to the weakening of the ruble, which raises concerns among investors about a possible fall in Russia’s income from gas exports,” Milchakova explained.

Moreover, according to her, recently many exporters have become more likely to leave foreign currency earnings abroad, since the government had previously softened a number of requirements for business. Previously, companies had to return at least 80% of earned dollars, euros, and yuan from abroad and exchange at least 90% of the transferred funds into rubles. However, now these thresholds have been reduced to 40 and 25%, respectively.

Thus, fewer dollars, euros and yuan began to flow into Russia from exports, and the demand for them increased due to the seasonal increase in imports. As a result, a shortage of foreign currency arose in the domestic market – and it began to rise in price relative to Russian currency.

“Market participants are also alarmed by the uncertainty ahead of the next OPEC+ meeting in early December. There is a possibility that Saudi Arabia will begin to increase daily oil production, and this will lead to a decrease in prices for energy raw materials and will further undermine the position of the ruble,” said Alexander Shneiderman, head of the sales and customer support department at Alfa-Forex, in an interview with RT.

To help the ruble

According to experts interviewed by RT, the rise in dollar, euro and yuan rates plays into the hands of exporters and the state. Thus, as the national currency depreciates, companies, when supplying the same volume of goods abroad, receive a larger amount of revenue in ruble terms. As a result, business profits begin to increase along with the country’s budget revenues.

In the current conditions, when the Central Bank is raising the key rate to fight inflation and it is becoming increasingly difficult for enterprises to take out new loans, the high exchange rate provides significant support to Russian exporters. This was announced by the head of the country’s Ministry of Finance, Anton Siluanov, on November 26.

“The exchange rate for export is more important (key. — RT) bets… I’m not saying he’s good or bad. I’m just saying that today the course for exporters is very, very conducive to exports,” Siluanov said at the plenary session of the IX International Forum of the Financial University.

• RIA Novosti

• © Alexey Druzhinin

The position of the head of the Ministry of Finance is shared by BCS World of Investments stock market expert Alexander Shepelev. At the same time, as the expert noted, too expensive foreign currency creates problems for importers and contributes to rising prices for goods and services.

“For every 10% weakening of the ruble, it adds 0.5 percentage points to inflation. In addition, prolonged devaluation impulses lead to increased inflation expectations among the population and business. Therefore, in the near future, it cannot be ruled out that financial authorities will intervene in the situation,” Shepelev suggested.

Natalya Milchakova shares a similar point of view. According to her, the government may again raise the threshold for mandatory repatriation of foreign currency earnings to 80%. In addition, as RT’s interlocutor believes, already in December the Central Bank, in its desire to slow down inflation, will probably raise the key rate again. This, in turn, will make ruble savings even more attractive and will help curb the outflow of funds from the country.

However, before these decisions are made, exchange rates may rise a little more, experts say. Thus, according to Alexander Shepelev, in the next month the value of the dollar will fluctuate in the range of 99-107 rubles, the euro in the range of 104-112 rubles, and the yuan in the range of 13-15 rubles. Natalya Milchakova is confident that by the end of the year the situation on the foreign exchange market will stabilize.

“Perhaps the Ministry of Finance and the Central Bank will take measures to curb the weakening of the ruble closer to the New Year, since too strong a fall in the national currency could interfere with the fight against inflation. We expect that by the end of 2024 the dollar exchange rate may fall to 98-100 rubles, the euro to 106-108 rubles, and the yuan to 13.5-13.9 rubles,” Milchakova concluded.

It is noteworthy that the country’s leadership maintains a more optimistic outlook. Thus, the Ministry of Economic Development expects that by the end of this year the value of the dollar will drop to 93.8 rubles, the euro to 102.7 rubles, and the yuan to 12.6 rubles.